Big Oil Stocks Thrive Amid Iran War Uncertainty

The Iran War has reached its six-month mark, and investors are wondering where to invest in the energy industry. Zacks Market Edge host Tracey Ryniec recently discussed this topic on her podcast, highlighting three global Big Oil stocks: ExxonMobil (XOM), TotalEnergies (TTE), and Chevron (CVX).

Big Oil companies control all aspects of the energy ecosystem, from exploration to refining and distribution. These integrated companies have been generating massive free cash flows in 2026 due to elevated refining margins. In the second quarter, ExxonMobil saw $17.2 billion in free cash flow, while Chevron reported $19.6 billion. TotalEnergies added another $9.8 billion.

Refining margins remain high, even with oil prices under $100 per barrel. Russia's drone strikes on refineries have taken refined products off the global market, leading to an export ban on diesel due to damage to its refineries. Big Oil companies can make money through multiple streams of revenue, making them attractive investments.

ExxonMobil operates 21 refineries worldwide, with record second-quarter diesel production. Its shares are up 37% year-to-date and are still attractively priced with a forward P/E ratio of 14.1. TotalEnergies has seen impacts from the Middle East conflict but still generated operating cash flow of $9.8 billion in the second quarter. Chevron saw record U.S. production and worldwide production was up 20% due to the Hess acquisition and strong results in the Permian Basin and Gulf of America.